Enabling the evolution of wealth advice in Canada

Five key wealth management themes emerge

We identified five key themes that sum up the major changes occurring in financial advice in Canada:

1. Investors are changing. Social and cultural movements correcting the gender power imbalance, combined with changing Canadian demographics, have led to the emergence of two new and powerful investor segments—women and millennials—both seeking a different style of relationship with their wealth management firm. From greater transparency and control to wealth management based on life scenarios, changing demographics are causing seismic shifts in how advice is offered.
2. The industry is transforming in response. In response to changing investor views on advice and service, the industry is starting to shift from a product-led business to one that focuses on holistic advice, financial planning and related services. This relationship-oriented model could enable a more holistic experience that supports an investor’s (or family’s) financial goals and objectives—and ideally, their lifestyle—in which investment portfolios are now only one piece of the puzzle.
3. Emerging digital business models and tools. New business models—many of which include a mix of human and robo advice—are the way forward. Some firms are introducing new tools and services to support budgeting, lifestyle management and career planning to help clients manage their financial well-being.
4. Innovation headwinds in Canada. Headwinds abound, from fragmented and duplicative regulatory ecosystems, to legacy technology issues. The interviewees were vocal about the delays caused by these headwinds, but they appear to be forging ahead—albeit at a slower pace.
5. Opportunities to enhance engagement. Dealers are trying to strike a delicate balance between fostering innovation and working collaboratively with regulators.

Looking ahead

A red thread ran through all the interviews: A changing landscape requires a changing client experience and approach from:

• Siloed to hybrid
• Fee-based to advice-based
• In person to omni-channel
• Complex to simplified
• Boilerplate to tailored
• Account to relationship

We see leaders in Canada’s financial advice sector working on pieces of this puzzle, but it’s rare that a firm is moving forward on all counts. It is a massive undertaking, requiring a strong ecosystem of partners and advisors—from technology to strategy. But, most firms are becoming far more proficient at putting the client at the center of every interaction. It’s that mindset that will carry them into the New and spell continued viability.